Hello, and good afternoon EMoney88!
While corporations do not receive the same special long term capital gains tax rates as individuals, they do still classify the stock as long, or short term, in the same manner as individuals.
The profit or loss from a sale or exchange of a corporate asset held for more than a year, is a long-term capital gain or loss. Likewise, the sale or exchange of an asset held for a year or less ,is a short-term capital gain or loss.
Corporations can use a short-term capital loss to offset a long-term capital gain, reducing the company’s taxable income. An added advantage is that the IRS allows corporations to use capital losses to carryback and offset their capital gains for up to three years, and they can also carryforward the capital losses for five years.
Have a great rest of your day!
Terri Lynn, EA
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer.”
Terri Lynn
